Understanding the “NO WIN NO FEE” legal Cost Agreement when making a personal injury claim in Western Australia

Nobody wants to get hurt. When you are hurt, it affects not only you but your family and loved ones. Many injured people, should it be due to work related injuries or disease, motor vehicle related injuries or any other type of injuries caused by the negligence of others choose to seek compensation for their injury. In this situation, injured people can get legal assistance from a personal injury lawyer, or sometimes referred to as a compensation lawyer, to assist with their personal injury claim.

Personal injury lawyers / compensation lawyers are lawyers that specialised in providing legal representation for injured people when they are hurt as a result of a third party or in a workers compensation claim. In Western Australia, personal injury lawyers / compensation lawyers charge either on hourly basis or contingent basis. The most common type of contingency fee basis is called “NO WIN NO FEE” claim.

When you are injured and under financial burden, the “NO WIN NO FEE” legal cost agreement can be a great help for injured people who will otherwise not able to afford legal assistance. One of the reasons that personal injury lawyers offer “NO WIN NO FEE” legal services is to be able to offer their service to wider amount of injured people who are in need of legal assistance. Expert personal injury compensation lawyers often can and will assess your chance of success and take on a reasonable risk in acting on your behalf.  If you are offered a “NO WIN NO FEE” legal cost agreement, it often means you have a fair chance of success. But when over promise is made, is it prudent to cautious.

In broad terms, “NO WIN NO FEE” means if you don’t win, you don’t have to pay legal fee. However, the interpretation could differ from one cost agreement to another, it is strongly recommended that injured public seek clarification before enter into a cost agreement.

In the case of a personal injury claims, different type of costs may incur throughout your injury claim. The key components are:

• Legal fees: this is the fee charged by your personal injury lawyer who represents you in your personal injury claim

• Medical and hospital fees: this could be the fee charged by a medical provider or a hospital, typical examples are your doctors for medical reports

• Allied health & vocational rehabilitation fees: a typical example could be the cost of physio for your injury habitation

Take a workers compensation claim in Western Australia for example. The usual practice is that if a settlement is paid to a worker, then their employer’s insurer will pay a contribution towards the worker’s legal costs over and above the compensation payout plus disbursements.In 2013 – 2014, Medical and rehabilitation related fees accounted for 68% of the service fee payout, and legal and miscellaneous payments accounted for 31% of the amounts paid.

In some very rare occasions, a personal injury lawyer may offer no legal fee guarantee regardless if you win or lose. What this means is that your compensation lawyer takes on all the risks for your claim. If you lose, not only will your lawyer not get paid, they even liable for the legal costs of the other side. As pointed out by LegalAid WA that “Going to court is nearly always expensive and you can rarely be guaranteed a win”. If your compensation lawyer is taking all the risk, Foyle Legal suggests that injured people should ask questions about the lawyers’ own risk mitigation strategy.Will their risk mitigation strategy affect the outcome of your claim?

In recent years, there few legal practioners were disciplined by legal practice board for fee related matters. The advice from LegalAid WA in relation to “NO WIN NO FEE” cost agreement is – “Make sure you read the agreement very carefully. If your claim is successful they may add a “premium” (additional charge) on top of the normal fee they would charge. Be careful not to be pushed into settling a claim unless you are happy to do so.”

The best way to understand the legal cost agreement is to ask for a copy of the agreement, and question your lawyer if anything unclear. If you know anyone who has used the lawyer before, ask them about what they think of them, and would they vouch for the lawyer.